Bulletins

Facebook hit with two antitrust lawsuits

It's the most aggressive action against a major tech company in decades.

The Federal Trade Commission and a coalition of 48 attorneys general filed two sweeping lawsuits against Facebook on Wednesday, alleging the company has abused its enormous power to stifle competition and maintain its position as the dominant social networking platform.


It's the most aggressive action against a major tech company in decades, and it could ultimately result in the complete breakup of Facebook if the government has its way.

The FTC said it is seeking a permanent injunction in federal court that could require Facebook to unwind its Instagram and WhatsApp mergers, shocking even close industry watchers who didn't expect the government to go that far. "Personal social networking is central to the lives of millions of Americans," said Ian Conner, the director of the FTC's Bureau of Competition. "Facebook's actions to entrench and maintain its monopoly deny consumers the benefits of competition. Our aim is to roll back Facebook's anticompetitive conduct and restore competition so that innovation and free competition can thrive."

New York Attorney General Letitia James, who is leading the coalition of states in their suit, said states are asking the court to "halt Facebook's anti-competitive conduct" and "provide any additional relief it determines is appropriate, including divestiture of illegally acquired businesses and/or Facebook's assets."

The cases from the FTC and states were announced simultaneously and both contain similar allegations. They were both filed in the Washington, D.C., federal court and will likely be consolidated into one lawsuit further down the line.

They both allege that Facebook violated antitrust law with its acquisitions of Instagram and WhatsApp, and call for an end to its unfettered acquisition of smaller companies and potential rivals.

Facebook in a statement accused the government of calling for a "do-over" after the FTC cleared its acquisitions of Instagram and WhatsApp in 2012 and 2014, respectively.

"We're reviewing the complaints & will have more to say soon," Facebook said. "Years after the FTC cleared our acquisitions, the government now wants a do-over with no regard for the impact that precedent would have on the broader business community or the people who choose our products every day."

The Facebook antitrust case will likely become ensnared in the courts for years as the social media behemoth and government lawyers battle over whether Facebook harmed consumers and distorted the market as it became arguably the most popular social networking site in the world.

The FTC and state attorneys general both quote extensively from Mark Zuckerberg himself, who wrote in a 2008 email, "It is better to buy than compete," according to the FTC.

Update: This article was updated at 12:30 p.m. PT with Facebook's response.

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